Texas Parks and Wildlife CommissionFinance Committee

Jan. 26, 2005

BE IT REMEMBERED, that heretofore on the 26th day of January, 2005, there came to be heard matters under the regulatory authority of the Texas Parks and Wildlife Commission, in the Commission Hearing Room of the Texas Parks and Wildlife Department Headquarters Complex, to wit:

APPEARANCES:

THE TEXAS PARKS AND WILDLIFE COMMISSION:

Ned S. Holmes, Houston, Texas, Committee Chairman

Joseph B.C. Fitzsimons, San Antonio, Texas

J. Robert Brown, El Paso, Texas

Alvin L. Henry, Houston, Texas

Peter M. Holt, San Antonio, Texas (Absent)

Philip Montgomery, Dallas, Texas (Absent)

John D. Parker, Lufkin, Texas

Donato D. Ramos, Laredo, Texas

Mark E. Watson, Jr., San Antonio, Texas

THE TEXAS PARKS AND WILDLIFE DEPARTMENT:

Robert L. Cook, Executive Director, and other personnel of the Texas Parks and Wildlife Department

PROCEEDINGS

COMMISSIONER HOLMES: We'll convene the meeting of the Finance Committee. The first order of business is approval of the Committee minutes, which have been distributed. Is there a motion?

COMMISSIONER RAMOS: I'll move. So moved.

COMMISSIONER PARKER: Second.

COMMISSIONER HOLMES: Moved, seconded. Discussion?

(No response.)

COMMISSIONER HOLMES: All in favor, say aye.

(A chorus of ayes.)

COMMISSIONER HOLMES: The motion carries. Mr. Cook.

MR. COOK: Mr. Chairman, just a quick review. I sent you folks a brief information packet the other day on kind of where we were as far as our budget, and the legislative budget proposal. I don't want to spend a bunch of our time going back through that, but I did want to note to you that the LBB instructions — apparently the instructions that they got back in September, October, certainly were to glean every General Revenue dollar that they could from the various budgets throughout the state.

And I have, since we last talked, met with several of the executive directors of about 20 of the agencies, and they all experienced pretty much the same thing. They did include considerable cuts from an operational standpoint. The most impact to us would be in Our State Park System and of course, in the Local Parks Grant Program. So we have got some work to do, and we are certainly optimistic that we can make it clear that our priorities, as we submitted in our Legislative Appropriation Request — that our priorities are justified.

And our top three, or four, or five of those priorities, particularly including Prop 8 funding, we need about $2.8 million a year in General Revenue to fund that payment of that Prop 8, of the next round of Prop 8 program, just to continue the basic repairs of health and human services, water, wastewater treatment, safety, ADA programs that we have in our existing facilities. It would be wonderful if we could pick up another million, excuse me, a couple to $3 million a year GR for state parks. We talked about those needs many times, and we need to rehash them.

Our other priorities, as you may recall, on our list included replacement vehicles and equipment. And that was a huge item for us, restoring the 5 percent cuts. There are several of those that we can fund with our current revenue stream as a result of our fee increases a year ago, if we will be allowed to utilize those revenues available. And they are dedicated revenues. And so that is an important item for us, and that is one that everybody we are talking to — that is kind of the emphasis we are giving. You know, you can work those numbers a lot of different ways, but in state parks, we believe, Drew and I have looked at the numbers. Just again, a preliminary look, but it looks like we can sustain the utilization of another 4 2 to $5 million dollars a year out of Fund 64 and somewhere in the range of $5-6 million a year out of Fund 9. And that is in addition to where we are right now. And those funds are there. It is not like the funds are not there. They are in. They are in the revenue stream. We have got a full year of them in the bank.

So that is kind of in a nutshell, that is kind of our emphasis area. We need some Prop 8. It would be wonderful to have some help in state parks. And let us utilize — to do the other things. Replacement vehicles, restore the 5 percent in our operations, let us utilize the funds that we generated as a result of fee increases. So that is in a nutshell, pretty much where we are.

Again, I think we have got some real support out there. Where we are right now, if we ended up with what LBB proposed, we will not have funds to make any of these major repairs that are needed. Or like when we have a flood on a site like Garner, that takes a quarter of a million dollars or so, just to clean up after the flood and get it back into operation. Those funds won't be there unless we take them from somewhere else. It is going to put us in a really tough position. And I don't want to go past the value of our Local Park Grant funding programs. Wonderful program. You have all seen it for years, many years, and how important that program is to the community. We talked about some of that this morning, in the urban areas. Those kinds of programs are going to have to be funded out of GR.

And there are several different moves in place. We have talked to a lot of people. A lot of people have talked to us about raising the cap on sporting goods tax and the potentials. Certainly, the potential to allow us to use our revenue stream is there. As you may recall, we went to the Governor, the Lieutenant Governor, Speaker and the Chairmen of both appropriation committees, prior to the last session to discuss that potential fee increase with them. And that we could do that, and that it was timely, and they all agreed, and we did. And then, what they got into, and I understand their situation, I am not — they had a tough job last time. It looks like we got a little more flexibility, so we are optimistic as to our possibilities.

COMMISSIONER WATSON: Okay, well now who makes the decision to deny us access to the funds, or to allow us to have access to the funds that we raise ourselves?

MR. COOK: Well, it is a matter of the — and I may have to get Drew to help me out here a little bit, but bottom line, it is the appropriation.

COMMISSIONER FITZSIMONS: The money has to be appropriated, even though we raised it.

MR. COOK: In other words, we have seen the years where the appropriation level that they gave us, we didn't even have the money to get all the way there. But right now, we have got the money but our appropriations cap is below our funding.

COMMISSIONER FITZSIMONS: We are raising more money than we have appropriated.

MR. COOK: So, to answer your question, Appropriations Committee, Mr. Ogden and the Senate Committee — you know, and there is still appointments to be announced there, and in the House. Mr. Pitts who, you know, we hear good things about, but we don't know Mr. Pitts well. We have not dealt with him in the past. And I hear he is a good gentleman. I am sure he will do his job well, but we have got to get those committees, subcommittees of those committees, we have got to get their attention and talk to them about utilizing those funds.

COMMISSIONER WATSON: So, if we get ourselves in a situation where we have got more money than we have spent, then we get back and those monies can be taken into the General Revenue.

MR. COOK: Well, it could be. Those dedicated funds, of course, are protected by statute. They would have to change the statute now to actually reach in there and spend them, but they don't have to appropriate them for us to use.

COMMISSIONER FITZSIMONS: Yes. They can leave them there to balance the budget. Which is how it's often done.

COMMISSIONER PARKER: Leave them there and borrow against it.

MR. COOK: And you know, the bottom line for me and I B

COMMISSIONER PARKER: They'll use it to balance.

MR. COOK: I don't know if this is appropriate for me to say or not, but in the scheme of things, our need to have a stream of revenue for repairs, the major repairs that we need — I mean, like right now, we are looking at still — we have got the battleship sitting there in bad need of repairs. It is going to have to happen. The monument, the San Jacinto Monument, is closed right now.

And actually, we have got our engineering numbers back. Steve will tell us more, a little bit about it later, I think. But we have got our engineering numbers back and to get the San Jacinto Monument back in operation is not going to take $4-5 million like we first thought. It sounds like about $2 to $2 2 million. We can put that facility back in top notch operation. But that is something that cannot be — those kinds of programs cannot be even initiated with just the revenue stream that we have. There will have to be some Prop 8 money.

Real numbers, if I understand it right, and I think I am probably pretty close, in real General Revenue, like I said, we need about $2.8 - $3 million for our Prop 8 payment to expand and continue, in addition to what we have right now. To expand that debt service you need about $2.8 million there. You know, so you are not talking a lot of General Revenue dollars here.

You need for instance, our fish stamp. For some reason, and I don't remember the rationale why, Drew may help me again, they didn't appropriate all of our fish stamp revenues. In other words, we can't kick off this hatchery thing until we get, I mean, they capped us at what? Drew, help me out here just a tad — $13 million? And we need them to say that you have got that $15-16 million dollars that you need. Use it and go.

MR. THIGPEN: That's correct.

MR. COOK: Am I close, Drew? I hope I am not...

MR. THIGPEN: That is correct. I am Drew Thigpen, Deputy Executive Director for Administration. On the Freshwater Fish Stamp, it is a total of $15 million that we are looking at right now. In the base, they have actually included — just since I talked to Bob yesterday, I found out that there is another $4.7 million, I believe, in the base. So our request in that area would have to be for additional appropriation authority of about $6 million, instead of $11 million that we had talked about.

MR. COOK: Okay. Okay. So it is just a matter of one — of we do need a little help in our Prop 8 type areas. We do. But it is not a huge number. It is $3 million, $4 million, $5 million a year tops.

COMMISSIONER HOLMES: Yes, sir.

COMMISSIONER PARKER: Just so everybody understands about the fish hatchery, I would like to have Drew explain that to us, because if he explains it the same way that it was explained to me yesterday, there is going to be unhappy people.

MR. COOK: There already are some unhappy people.

COMMISSIONER PARKER: There is going to be some unhappy campers in that freshwater fishing community.

MR. THIGPEN: Well, I am a little behind the curve, because I wasn't involved in the discussion yesterday, but my understanding, Phil, do you want to come up and join us?

COMMISSIONER FITZSIMONS: Come on Phil, join the party.

COMMISSIONER HOLMES: It's the Finance Committee, Phil.

MR. DUROCHER: I thought it was infrastructure.

MR. COOK: Well the bottom line is, we can't start building the fish hatchery until we have the funds appropriated to build and complete the hatchery.

COMMISSIONER FITZSIMONS: I'm sorry. Point of order. Are we anywhere close to the agenda?

MR. COOK: Chairman's Charges.

COMMISSIONER HOLMES: We're veering slightly off.

COMMISSIONER FITZSIMONS: All right.

MR. COOK: It's the general backlog.

COMMISSIONER HOLMES: It's all right.

MR. DUROCHER: The problem is, the money is dedicated. It was dedicated by statute. The stamp money can only be used for what we are using it for. And it is building up now in an account. But we have to have the appropriation authority to spend it, or we can't start the project.

COMMISSIONER PARKER: Tell them some of those numbers you told me.

MR. DUROCHER: We estimated that at the end of this year we'll have $5 million in the bank or close to it — $4.2 - $5 million. Next year, another $4.2 million, and the year after, two years of the biennium, we'll have $4.2 to $5 million each year. So we will have three years' worth of money that we should be able to spend, but they've only — and LBB's recommendation for the biennium that capped it at what?

MS. FIELDS: There is $8.1 million in there, and $6.9 million is what we still need to request. So Drew was fairly close with the $6 million — $6.9 million is what we need to request in appropriation authority to spend that revenue.

MR. COOK: And Mr. Chairman, I didn't mean to get you off track. It is just that B

COMMISSIONER HOLMES: No, I think that appropriations — the question was in appropriations, and we use the fish hatchery as an illustration.

COMMISSIONER WATSON: Okay. Just to kind of summarize, we were very responsible and entrepreneurial in raising the fees, because that was necessary. And so we have gone about it, and we have done our part to put these things in place. We have taken a lot of heat for that. Now we have got the money, and now we can't do anything with it.

COMMISSIONER HOLMES: There's probably a more cynical view than that.

(Simultaneous discussion.)

MR. COOK: Actually one point, Commissioner, that I would like to make in retrospect here, that I think is important — our constituents have been incredibly supportive of these fee increases that we did, and of the freshwater fishery stamp. They believe that they are paying these dollars in here for the right thing. They haven't been complaining, and they are real positive about it.

COMMISSIONER FITZSIMONS: They need to know that the money they paid us, we didn't get.

MR. COOK: We hope it doesn't go that far.

COMMISSIONER WATSON: Well, we're all going to have a chance over the next few months to talk to different people. I just wanted to make sure I understood. And that helps me.

COMMISSIONER FITZSIMONS: No, but you make a good point. We took the heat. We ought to get the money.

COMMISSIONER HOLMES: Well, it is dedicated. The issue is whether it is in the form of an IOU or cash in the bank. And most likely, it is an IOU. And we are a very popular agency that helps raise funds to balance the budget.

MR. COOK: We have a lot of friends out there. A lot of these areas that we are talking about, there are folks on the Appropriations Committee for example who do not want that railroad to be parked. And we have friends who will do everything they can to help us get funding for the overall program, and the battleship repair, and the San Jacinto repair. We have got those kind of commitments and those kind of folks are out there helping us.

MS. FIELDS: Good afternoon, Commissioners. For the record, I am Mary Fields, Chief Financial Officer, and I am here to give you a financial review update. The focus of our presentation today will be to provide a revenue and budget status for Fiscal Year 2005, and update you on the progress we have made on the Business Improvement Plan.

Let's start with the revenue and budget. When comparing state park gross receipts through November 30 from 2004 to 2005, we are up 6.2 percent or $391,000 over last year. While on this, all the categories of park revenue are showing some increase. The largest component of revenue growth is from entrance fees, followed by an increased revenue from our State Park Pass sales.

Our boat revenue, as of November 30, is up by 8 percent or about $245,000 compared to last year. The increased revenue relates to increased boat registrations and titles. I think last year we saw actually somewhat of a decline, but we had fee increases from the prior year. This year, there haven't been fee increases but we're seeing increased titles and registrations coming through. The boat registrations are up by about 5 percent, and the number of titles issued are up by about 1.5 percent. We continue to transfer 15 percent of the registration and titling revenue to Fund 64 and that amounts to about $436,000, based on revenues through November.

More positive news here on license sales and the revenues. As of November 30, we are at $59.2 million. We are up $2.7 million in revenues as compared to last year, or $4.8 percent. If you exclude the Freshwater Fish Stamp revenue of $2.2 million, to be more comparative to last year, we are still up by about $449,000 or a little less than 1 percent. When you are looking at the categories, our combo revenue is up about 2.5 percent, fishing is down 5.2 percent, hunting is up 3 percent, and other licenses are down by a little under 1 percent. But overall, we are ahead of where we were last year.

In looking at the number of licenses sold, which correlate to those revenues, our total number of licenses sold is up 23.6 percent as of the 30th. Within those categories, other license sales are up 6.2 percent, hunting is up .7 percent, fishing is down 3.1 percent, and total combo sales were down by 4.3 percent. Again, if you want to look and make it more apples to apples, if you exclude the $468,000 of Freshwater Fish Stamps that have been sold, we are up by a little over 7,000 licenses, which is about .4 of a percentage.

When comparing our 2005 revenue collections to our annual revenue estimates, we are progressing there as expected with 25 percent of the year elapsed. We have collected 44 percent of our Fund 9 Game, Fish and Water Safety Funds, 26.2 percent of State Park Funds, 24.5 percent of Local Parks, and the other category is also doing well at 59.4 percent. There are several funds in that category. There a couple that are running pretty far ahead right now. That is what is driving that statistic up.

Looking at our budget versus expense, you can see we have $226 million available, or 77.5 percent that is available at this time with 25 percent of the year elapsed. Again, this is really tracking as expected. The salaries and other personnel costs and the benefits on the screen are right where they should be with about 76 percent of the budget remaining.

The spending on operating and equipment is a little bit ahead of schedule with 70.4 percent of the budget remaining, but we pay some of our rental contracts and leases up front in the year, so that is what is driving that up just a little bit. Grants are progressing nicely. Capital projects, we are showing 93.8 percent of the budget available there, but we do have several projects that are progressing now, and I expect to see that balance go down as the year progresses.

And just summarizing our budget adjustments, you can see we have $9.3 million of adjustments that were made since I last reported to you on our budget as of September 30th. We are at $291.8 million. As I told you, we would be seeing some federal grant adjustments coming into the budget, and you see $6.6 million there of basically federal grant adjustments. There were four sizeable ones that related to Balcones Canyon Land, the restoration of Starvation Cove, the National Oceanic and Atmospheric Administration and Endangered Species. We also had adjustments to unexpended balances of about $2.1 million. Again, most of that is just carryforwards. Further adjustments, as you can see, were also made for donations and other.

In moving, and looking at our Business Improvement Plan, we have cleared another couple of items since I last spoke with you. We cleared a recommendation relating to our reconciliation of license sales revenue and another recommendation relating to consolidation of bank accounts. So we have, with 94 items in the plan, 86 of them are complete, or 92 percent. And then we have 4 percent that are at least 70 percent complete and 4 percent that are below 60 percent complete. And as I mentioned, those relate to automated systems, primarily.

And that concludes my presentation. Are there any questions?

COMMISSIONER HOLMES: Any questions or discussion?

COMMISSIONER FITZSIMONS: Good job. I'd take credit for those license numbers.

MR. COOK: Kind of like a good quail year.

COMMISSIONER FITZSIMONS: Yes. Can't take the credit for that.

COMMISSIONER HOLMES: Yes. Thank you, Mary. I think just Commissioner Watson, to kind of further amplify the point, that license sales are running ahead of revenues and parks are running ahead. In fact, we could end up with some fairly sizeable balances at the end of this biennium. It could be $25 million or so in parks, in Fund 64, and maybe $45 million or $47 million in Fund 9. And so that appropriation authority is really significant. And you combine that with an effort that is being led by former Commissioner Angelo to lift the cap on the Sporting Goods Tax, which is supported by major sporting good retailers and others, it is important that it happens, but it is also important that the appropriation process allow us to spend the money. Because all we will be doing is increasing the opportunity to loan it to some other agency if we don't. Committee item number three, Local Park Grants rule amendments. Chapter 61, Subchapters B through E. Tim?

MR. HOGSETT: Good afternoon, Gentlemen. I am Tim Hogsett from the Recreation Grants Program in the State Parks Division. We are bringing you tomorrow a request for adoption of rules for the Local Park Grant programs under the umbrella of the Texas Recreation and Parks Account. We go through this process every five years.

I consider it some of the most important work that we do, because it is a reflection of our accountability and it is a reflection of our customer service. And these are our customers that have gone through this process with us. The programs that we have reviewed as part of this year-long, almost year-long process include: Outdoor Recreation Grants, Indoor Grants, Community Outdoor Outreach Programmatic Grants, Regional Park Grants, small community grants, and the last one, Recreation Trails which are not actually under the Texas Recreation and Parks account. They are passed through federal funds that we felt that we needed to do a review of that program as well.

Here is what the process looks like from beginning about this time last year. We did some staff work. We did a rather extensive survey that was well responded to. We had a focus group which was comprised of your Local Park Advisory Board plus some additional people that we invited who had been frequent grant participants. We did eight public hearings around the state. I came before you in November and presented the original draft rules. You gave us the permission, and we posted those in the December edition of the Texas Register, and we have gone through the required comment period in the Register. The two issues that we reviewed are the priority ranking systems or the scoring systems, if you will, that you adopt and that we then as a staff use to make recommendations to you on who will be funded and who won't.

And then we took a look at general administrative rules and practices of the grant programs. So first, I want to go through with you a summary of the major changes that we are proposing in the priority ranking systems. And frankly, none of these changes are extremely drastic. They are some fine tuning kinds of things, but they are a direct reflection of what we heard through the public hearing process and other input — what people wanted.

First, we are proposing decreasing priority points for land acquisition projects for outdoor grants. It almost is a requirement under the current scoring system that you have an acquisition element of your project for you to be competitive. And you know, we heard from quite a number of folks that that is not necessarily always their priority. We are proposing increasing slightly the points for park renovation projects. For the indoor, outdoor and small communities program, this one really is coming to us primarily from the urban communities. They are saying we have got aging infrastructure. Same situation we are facing in our state parks, they are facing out there with aging infrastructure. And they want to try to take care of what they have got before they do additional development. And we are proposing awarding land acquisition priority points for property that is already publicly owned property but will changed from whatever its current use is, to parkland. We feel that that equates with an acquisition of a new park. We are proposing simplifying the priority point awards system where you get priority points if you have a local master plan.

It is now a pretty complicated system, even for us as staff. And we are proposing to drastically simplify that to make it more understandable.

Proposing that we penalize in the Community Outdoor Outreach Program sponsors who have large unspent balances when they close their projects. Those are program funds. Those are not construction kinds of projects. And they are small grants. There are only $30,000 each. Typically, they are the non-profit organizations, and we just think that it is very important that a group, if they do come and go through the competition and are awarded one of those, that they spend the money, and spend it efficiently. And there are some problems related to that. So we hope that this will help fix that.

Proposed decreasing youth-at-risk priority points for indoor grants and standardizing the point value for special populations among all the programs. We had, in the old scoring system, been giving youth-at-risk quite a number of additional points in the indoor program as compared to the other, like outdoor and small communities. The reasoning at the time was, we thought that indoor facilities lent themselves more to youth-at-risk kinds of programs. But we heard through this public hearing process, that that was not necessarily the case. That outdoor facilities many times serve just as well for those kinds of activities. So we are just sort of leveling the playing field.

We are proposing eliminating priority points based on the percentage of population served for indoor grants. What we heard there essentially was, and we saw it in practicality and applications that people will build a recreation center, and it would serve the entire community. Having it based on a percentage of their population except maybe in a community like Houston or Dallas really didn't make a lot of sense. And this was one that we were asked several times to change. We are proposing allowing any method of land acquisition for small community grants. Currently, we allow land acquisition if it is donated property to be used, but we do not allow for acquisition by fee purchase. The thinking there was it is a small program with $50,000 grants. If you did a land acquisition, it probably would eat up most of the grant. But again, our surveys and participants told us no, we would like to have the opportunity if there is a need, to acquire land by purchase.

So the final two changes, the next two changes that we are proposing are reducing the number of points for greenbelt linkages for outdoor and regional parks. That came in in the survey we did as one of the lowest priorities of folks. They said that they just really didn't think that those kinds of linkages were as important as the kind of priority that we were putting on them in terms of numbers of points. It is kind of surprising to me, but nonetheless, that is what we heard. Proposing combining all of the criteria for all outside match into one criteria. Currently, in the current scoring system, we have one set of criteria for outside match, from public to public participation, and another category for public and private cooperation. So just for simplification purposes we propose to put all of those together in one criteria, and basically award the same number of points for them as a dual criteria.

The administrative rules and practices — again, these are rather minor changes, but ones that people told us that they would like to see. We are proposing increasing eligibility criteria for program participation for sponsors with active projects from $1 million to $2 million. What that basically does is currently, if you are a community and you have got several grants that are at some stage of completion when a new application is submitted by that sponsor, we do an assessment of where they are on their active projects. And currently, we say we will not review a new application if they have more than $1 million outstanding balance on the books of active grant projects. We heard particularly from the urban communities that that was hurting them.

That they felt that it was important that they have the opportunity, since they have the kind of resources to be able to do more than others, that they would like to see us raise that. So that is the reaction to that.

Propose to allow more than one application for programs in metropolitan areas with the exception of the co-op and the Trails Program. Those are smaller grants so we felt like, and was echoed in what we heard, that we ought to leave those as a one per application. But again, this is an urban criteria where the City of Houston, for example, has told us throughout this process they may have more than one thing that they want to be able to apply for at any given time, so we are proposing to allow more than one application from the metropolitan areas.

Proposing extending the eligibility of local master plans from five to ten years. Again, those are the plans that are produced locally, where they prioritize their own needs. We award points based on them asking for their highest priority needs. They are telling us — most of the communities are saying that a plan is good for longer than a five year period. So, we will say if you adopt these rules, that we will allow them to go with a longer plan up to ten years before they are required to redo it.

Flexibility and waivers of retroactivity, those are instruments that we allow local governments to acquire properties when there is a need to do so prior to them applying for a grant so they don't lose an opportunity. For example, a donation. It doesn't imply that we are going to give them any additional priority as a result of allowing it. We just simply say, retroactively, if you get a grant, you can use that donation or the acquisition as part of your project. We currently say that those kinds of commitments are good for three years. Again, we have heard that that is probably not long enough. So we are proposing to up that to five.

Proposed changing the application deadline in the spring for community outdoor outreach from March to February. We take applications for that program twice a year. The reason for this particular change is sponsors were telling us that they are gearing up, making applications for programs that involve summer activities after school is out. And that applying in March with an April or so award doesn't really give them enough time to gear up for that. So this was something we heard from quite a few of the co-op sponsors.

And then finally, allowing private entities to apply for Motorized Trail Grants under the Recreation Trails Program. And that is mainly because we as you know, have not received very many applications and we have quite a bit of money in the bank for Motorized Trail Grants. We have the commitment and the need to provide those kinds of facilities and so we are hoping that maybe some of the groups, like the Texas Motorized Trail Coalition, some of those folks will step up and apply for some of these and operate and maintain facilities.

As I said, we posted these rules in the Texas Register, the December 24, 2004 edition. We received numerous requests for copies of that posting, but received no comments. So I suppose that means that either — I hope it means that we did well. Tomorrow, we are going to ask you to adopt both a revised grant administrative manual and a revised scoring system for each of these projects, each of these programs. And I would be glad to answer any questions.

COMMISSIONER HOLMES: Any questions by the Commission?

COMMISSIONER HENRY: Tim, just recently the Houston Chronicle last week, or the week before last, ran a huge article concerning some projects in their northern part of Harris.

MR. HOGSETT: On Spring Creek?

COMMISSIONER HENRY: Yes.

MR. HOGSETT: I saw that.

COMMISSIONER HENRY: And one of the things that they mentioned in it, a lot of it had to do with these trails, and the coordination, and all that we run low in points for. One of the things that came through loud and clear was that they mentioned that they were joining together to apply for some $800,000 in grants from Texas Parks and Wildlife. Have you heard anything?

MR. HOGSETT: We are anticipating receiving an application or may have already received an application from both Harris County and Montgomery County for work along Spring Creek. We have done multiple grant projects in the past with Harris County along Spring Creek, and now the other side of the creek which is Montgomery County is getting involved. And we looked at the draft of that application and it looks pretty good. It looks pretty strong.

COMMISSIONER HENRY: That is a pretty massive program that they were talking about.

MR. HOGSETT: Yes, it is. I think it also involves an element of trying to get some of the off-road vehicle use out of Spring Creek that has been occurring — that has been creating some problems for them. So, yes, I am aware.

COMMISSIONER FITZSIMONS: That would be illegal though, now, wouldn't it? That off-road?

MR. HOGSETT: They are trying to do enforcement, but it is problematic there, like it is in a lot of other places. You have to be there when they are there.

COMMISSIONER RAMOS: Tim, I have always been a little concerned about the smaller communities. I know there is thousands of applications that you get. But the thought that I have had is that perhaps we could consider at some point, and I am not suggesting that we do it now, but a system whereby once a small community gets a grant that either they do not reapply for a certain period of time to let other communities share in those funds or two, penalize them and say, okay, instead of getting points, you are going to lose X number of points because you have already gotten some funds. The only purpose of that being that those small communities that really need the funds, that they are just, for whatever reason don't qualify, that they will have a greater chance of getting funds and I think we might get more communities involved. And I can see where in your urban areas that rule may not apply. But as to the smaller grants, where you know, and I am not suggesting at all that the same ones get it over and over again, but perhaps if someone is fortunate to get a grant that they are going to have to wait a little bit longer before they get it again.

MR. HOGSETT: You had asked that same question in November, and I asked a few of the sponsors that we dealt with in the small communities program how they felt about that and frankly, the response I got, a couple, several times was, we would prefer to go through a competitive process. We would like to be able to come in and apply as often as we can, and compete on the basis of a priority ranking system, as opposed to some staging. So I would be glad to consider it again, and go back out and see.

COMMISSIONER RAMOS: I just feel there is some communities out there that maybe are not as talented in putting together their packages or don't have the financial resources to make as nice a presentation. And there is a definite need there. I think every application that comes before you has a need. And all I am saying is, by implementing that, you may take these weaker applications perhaps, and I think even a weak application has a lot of merit. I don't think when someone applies, there is going to be some degree of merit. It may not fit the criteria completely, but it will give them an opportunity to have a better shot at it. Not that they will necessarily get it. And that is just — I can see where it may not apply in the urban areas, where there are the larger grants, but there is a lot of little communities that could use a little help like that.

MR. HOGSETT: What we do really endeavor to do always is work with these folks. Particularly, if they are not successful the first time, sit down with them and go through the resubmission process and help them. And packaging of an application is not nearly as important to us as making sure we understand what their needs are and that we are responding to those.

I don't think anyone would put an application together that didn't really feel they had a definite need for what they were asking for. But we will go back.

COMMISSIONER RAMOS: And I don't want it so much to be a penalty, but just to get everybody else a little bit of an edge on it. That is all I am I suggesting.

MR. HOGSETT: I understand.

COMMISSIONER FITZSIMONS: You do an excellent job. One of the great reliefs in this job is when people call me about their and it is usually in the rural community — that is my background, of those folks, I am able to tell them: follow the instructions. You'll do fine. And there was nothing political in this.

You just do follow Tim's point system and if you don't get it this time, you are going to make it next time. And they are amazed that that is the process: and you mean, you don't have to lobby you all? And I say: no, just follow the directions and you'll do fine.

COMMISSIONER PARKER: You know, the other thing is that there are professional grant writers to assist these communities, whether they are this big or that big, all over the State of Texas that will jump to the chance of helping those smaller communities write those grants, because I see that.

COMMISSIONER FITZSIMONS: Well, but they can't use the money that they get from them to pay the grant writers from.

COMMISSIONER HOLMES: The observation that I would make is that on many of these public sessions where we actually make the grants, that people that come and talk and thank the Commission and the staff, and they talk about the help and the assistance that they received from the staff, and so I would commend you for that. But I also encourage you to continue with it, particularly the ones that Commissioner Ramos is referring to that have their smaller communities with you know, less experience in grant writing. And the more help that you can give them, that brings them up to curve and makes them a competitive applicant the better it is.

COMMISSIONER FITZSIMONS: The most important thing we do is reinstate his money.

COMMISSIONER HOLMES: Yes, well that was the next thing I was going to say. Because unless we get it done this time, it doesn't make any difference anyway.

MR. HOGSETT: And I might say to that point, that these recommendations and this set of rule changes is based on current levels of funding. If we were drastically reduced in the amount of money that we have again, then I think we are going to have to revisit this whole issue.

COMMISSIONER HOLMES: Well, like zero. I believe, wasn't it reduced to zero in the LBB?

MR. COOK: We have still got a little money to work with, but it is not much from 467.

COMMISSIONER HOLMES: Yes. Even before whatever this reduction may or may not be, it is my impression that we run out of money before we run out the year.

MR. HOGSETT: Absolutely.

MR. COOK: Mr. Chairman, I would like to compliment Steve. I see Elaine Dill being here in the corner and they do such a great job, and I think part of this process review that you just heard Tim go through step-by-step and the involvement that they have already had with these communities and with the people involved, as a result, no comment. That means that a lot of work has gone into it to get just the proposal put together. That is what that means. And I compliment you for that.

COMMISSIONER HOLMES: Any further questions or comments? Discussion?

(No response.)

COMMISSIONER HOLMES: If there are no further questions or discussion, without objection, I will place this item on the Thursday Commission meeting agenda for public comment and action. Item number four. You are still up, Tim.

MR. HOGSETT: I think I am up the rest of the meeting. All right. Again for the record, I am Tim Hogsett from the Recreation Grants Program of the State Parks Division. Tomorrow, we are going to be making one of our twice a year requests for you to award grants to local governments from the Outdoor Recreation Grant Program. We received 15 applications by July 31, 2004 deadline, requesting $6.3 million. We have rank ordered and scored all the projects and rank ordered them according to the scoring system, and we are recommending approval of the top eleven projects for $4,792,337. About the only other comment I would make here is that 15 applications is a very low number compared to what we have had in the recent past.

And I think this is partially reflective on the fact that we did lose 30 percent of this account in the last session, and it is finally trickling down that people are somewhat discouraged and maybe not be putting applications together. And this will be the recommendation I will bring to you tomorrow. I will be glad to answer any questions.

COMMISSIONER HOLMES: Any discussion or questions for Tim?

(No response.)

COMMISSIONER HOLMES: If there are no further questions or discussion, without objection, I will place this item on the Thursday Commission meeting agenda for public comment and action. Mr. Cook?

MR. COOK: Yes?

COMMISSIONER HOLMES: You are still up.

MR. COOK: All right.

COMMISSIONER HOLMES: I jumped the gun. We have got a little bit more to go.

MR. HOGSETT: A couple more.

COMMISSIONER HOLMES: It says what we think of him though. We approved it before he gave it to us.

COMMISSIONER FITZSIMONS: You are doing a great job.

MR. HOGSETT: Indoor Recreation Grants, we bring before you once a year. This program was dramatically reduced in the last session of the Legislature. Not only did we lose some of the money that we received from Sporting Goods Tax, but we were explicitly reduced in the amount of money that we could give to this particular program by one of the riders in the Appropriations Bill. We formerly had about $3.25 million a year for this program available. That was reduced to $1,275,000 over the biennium, or $637,500 a year. We received five applications for the July 31st annual deadline requesting $2.5 million. We scored and rank ordered those projects. That can be found in Exhibit A, and we are recommending the partial funding of one application in the amount of $637,500. And this will be the recommendation that I will bring before you tomorrow. I would be glad to answer any questions.

And finally for me, Boat Ramp Funding. These are federal pass through funds from U. S. Fish and Wildlife Service. They are to purchase land and or construct boating access facilities. These are 75 percent matching grants to local governments and the local government has to agree to operate and maintain the facility for its life span.

We have received two applications. We are taking applications at any time currently for this program. We may go back to a deadline, but for now, we have sufficient revenue in this program that we feel like we can just keep a rolling application cycle going. We have received two applications since we came to you last, requesting $893,080 in matching funds assistance. One from the Village of Surfside Beach, which is in the Houston/Galveston area, the Freeport area, requesting a half million dollars for the construction of a three lane boat ramp, parking lot, loading docks, restroom, fish cleaning station and other facilities. And a second application from the City of Rockwall, requesting $393,080 to expand an existing single lane boat ramp and expand parking, construction of a second lane to that ramp, courtesy dock, picnic area, landscaping, walks and signage. And this one is on Lake Ray Hubbard.

And this will be the recommendation that I will be bringing before you tomorrow requesting this funding for $893,080. I would be glad to answer any questions that you have.

COMMISSIONER HOLMES: Discussion or questions?

(No response.)

COMMISSIONER HOLMES: Then we'll try this one again. If there are no further questions or discussion, without objection, I will place this item on the Thursday Commission meeting agenda for public comment and action. You're finished now? Thanks Tim.

Mr. Cook? Anything further?

MR. COOK: No, sir. Thank you.

COMMISSIONER HOLMES: This hearing is complete.

COMMISSIONER FITZSIMONS: Do you want to send the gavel over to Mr. Vice-Chairman Henry?

(Whereupon, the meeting of the Finance Committee was concluded.)

CERTIFICATE

MEETING OF: Texas Parks and Wildlife Commission, Finance Committee

LOCATION: Austin, Texas

DATE: January 26, 2005

I do hereby certify that the foregoing pages, numbers 1 through 38, inclusive, are the true, accurate, and complete transcript prepared from the verbal recording made by electronic recording by Penny Bynum before the Texas Parks and Wildlife Commission.